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Global aluminium long-term outlook Q3 2015

Report summary

Wood Mackenzie's Q3 aluminium Long Term Outlook analysis for global supply- demand dynamics and prices indicates a market that will be under pressure from a build up in metal surplus and low prices over the next 2-3 years. This is very much a China supply side story, with demand growth in the ROW projected to be steady, if not spectacular. The market in the ROW will remain tight, but more than offset by large surpluses in China, much of which will find a home in ROW markets. We estimate primary aluminium production of 57.3Mt in 2015, up 7.3% on 2014, with China contributing 31Mt to the total, a 12% year on year increase. We project further increases in Chinese production as global output growth jumps 6.7% in 2016. The onus is clearly on Chinese producers to address overcapacity. We expect the market to start the journey to balance only in 2018, with production adjustments primarily in China. Without production cuts we could be in for an extended period of weak market fundamentals.

Description

As global demand weakens and commodity prices fall, we're seeing a challenging environment in the metals and mining industry. Mining companies are increasingly coming under pressure to reduce operating costs, causing many to shift their strategic planning, delay new investments and look to long-term future growth.

This Aluminium Long Term Outlook report provides a detailed breakdown of global supply and demand balances in this market, as well as price forecasts.

Mining companies, investment banks and investors can use this report to understand the future direction of the ferrous and base metals market. It will also help you assess the impact of key industry issues and events on market balances and pricing.

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Wood Mackenzie's clients include every major player in the global energy, metals and mining industries. We are recognised as a leading authority by international and national energy, metals and mining companies, leading financial institutions, governments and government agencies. We work with a range of diverse teams within our clients, from strategy and policy makers, business developers and market analysts, through to corporate finance, risk teams and investors.

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Wood Mackenzie, a Verisk Analytics business, has been a trusted source of commercial intelligence for the world's natural resources sector for more than 40 years, empowering clients to make better strategic decisions with objective analysis and advice.

We work across every sector of oil, gas, power,renewables,chemicals, metals and mining, covering more than 150 countries. Our proprietary data and models are at the core of everything we do, ensuring our independent asset and company valuations are thoroughly robust and that we offer an accurate forward-looking view of economic indicators such as market supply, demand and price trends.

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Commodity market report | Sep 2015

Global aluminium long-term outlook Q3 2015

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